Income E-Bay User

[lqlsy2004]

My family has some cameras and would like to sell in E-Bay. Does he need to claim it? Which tax form should he use? He repairs some old cameras and how to claim the labor? Does it claim as a self-employment? Thanks.

[Geo123]

Hello lqlsy2004,

Yes you can enter as self-employment and declare the Revenues as well as expenses to earn that revenue.

>>>Interview setup
[Interview setup (left hand navigation pane - - beneath “CRA Express NOA”) >> Double click the interview setup]
>>>>Go to Right Hand Screen - Interview SetUp
:>>Self-employment
 >>Self-employed business income
>>T2125 - Business income
Select:
T2125P - Professional income
T2125C - Commission income
T2042C - Farming income (cash basis)
>>T2125 - Business identification ---> complete this section 
>>T2125 - Business Income / Expenses //
>>If applicable also enter Vehicle expenses // Home Office expenses // Labor Cost // CCA

1. On the "Left-side menu of the Interview tab", select "Interview setup".

2. On the screen that appears on the right, go to the "Self-employment" group, check the box "Self-employed business income", also if you paid tax by instalments. Then go to the "Tax paid by instalments and tax transfer" group and check the box "Tax paid by instalments and tax transfer" and click "Next" at the bottom of the page.

3. Return to the "Left-side menu on the Interview tab", click on "Self-employment income" and select the option "T2125 - Business income" on the right-hand side page.

4. On the "Business identification" page, enter the name of your business on the line "Business name (or your own name, if the business does not have one ", then enter the other information in the mandatory fields marked with a red asterisk.

5. On the field for "6-digit code from the North American Industry Classification System", enter the NAICS code that best describes your industry. If you do not know the NAICS code, click on the tool tip (the question mark) (?) on the right-hand side of the box to access a list of NAICS codes.

6. On the line "Products or services and their respective percentage (%) in the total income (mandatory for a Quebec return) ", in the field on the right, enter your main service or product and enter the percentage (%). If you have other products or services, click on the "plus sign +" icon on the right to generate another field.

7. Subsequently, after identifying your company, a submenu will appear on the "Left-side menu of the Interview tab" to allow you to enter the "Income & expenses", "Motor vehicle expenses", "Home office expenses" and so on.

8. On the next page ''Income, expenses'', on the line ''Gross sales, commissions or fees'', you must enter a value, if you have no income, enter $0, 00 as this is a required field. NOTE: for expenses, if your company is registered for GST and HST (QST), these expenses must be entered before taxes to reflect the ITRs (input tax refund) and ITCs (input tax credit) you claimed.

9. If you had partners, choose the subsection "Partners" and if you want to claim capital cost allowance for your office furniture and equipment, choose subsection "CCA" and select on this page the classes that apply to your profession.

10. For residents of Quebec, if you wish to pay your registration fee for Quebec, return to the "Left-side menu on the Interview tab" and choose the option ''Q438 - Quebec annual registration fee for the enterprise register''.

We recommend that you read the T4002 guide published by the CRA, for more information on what qualifies as a business expense.

For more information, please visit the following link:

https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/t4002.html

For Quebec residents, we suggest that you consult the "Business and Professional Income" guide, published by Revenu Québec. You can visit the following link:

https://www.revenuquebec.ca/en/online-services/forms-and-publications/current-details/in-155-v/

The program will also generate federal form T2125, as well as Quebec form TP-80 if applicable.

The gross and net amounts will be reported by the program on lines 13499 and 13500 of the federal return and, for Quebec   residents, on lines 12 and 22 of Quebec Schedule L.
 

[margaret234]

Selling items, including cameras, on eBay can have tax implications, and it's essential to be aware of your tax obligations. While I'm not a tax expert, I can offer some general guidance.

Selling Personal Items: If you're selling personal items, like cameras you no longer need and that you've owned for a while, this usually does not generate taxable income. The IRS generally considers it a casual sale of personal property.

Self-Employment and Repairs: If you're repairing and selling cameras as a business or side hustle, then it may be considered self-employment. In this case, you should report your income and expenses related to this activity on Schedule C of your tax return (Form 1040). You can deduct business-related expenses, including the cost of repairs and parts, as well as any reasonable labor charges.

Reporting Income: Regardless of whether it's a casual sale or self-employment, it's a good practice to keep records of your eBay sales and expenses. eBay may also report your sales to the IRS if you meet certain thresholds.

Consult a Tax Professional: To ensure you comply with tax laws and maximize deductions, I recommend consulting a tax professional or accountant. They can provide personalized advice based on your specific situation and help you navigate tax forms and requirements effectively.

Remember, tax laws can be complex and vary by location, so seeking professional advice is usually the best approach to ensure you're doing everything correctly.

[Geo123]

Hello,
The previous post relates to IRS (USA) reporting.
For the CRA EBay  transactions may result in taxable income.  They may be considered :
*dispositions of capital property, eligible capital property, personal-use property, listed personal property
*Business income  ( inventory)
You may also need to register for GST remissions if you exceed the threshold of income ie not a "small supplier"

If you are an eBay seller and are not sure if the income is taxable, talk to your professional tax advisor